The Tat gene of human immunodeficiency virus (HIV) plays a central role in the activation and life cycle of HIV. Tat exerts its effects at the level of transcriptional initiation and elongation. Here we report that Tat binds directly to the basal transcription factor TFIID. The transcriptional activity of HeLa extracts was depleted after chromatography on a Tat affinity column, which specifically retained the polymerase II-specific transcription factor TFIID. Direct interaction of Tat with holo-TFIID composed of TATA-binding protein (TBP) and associated factors (TAFs) was observed. Tat, through amino acids 36-50, binds directly to the TBP subunit of TFIID. Using a coimmunoprecipitation assay, the Tat-TBP interaction was detected in HIV-1-infected cells. Interestingly, the Tat-TBP complex is demonstrated at early, but not later stages of viral replication using a synchronized population of infected cells. The domain of TBP interacting with Tat has been mapped from amino acids 163 to 196 using deletion and site-specific mutants of TBP. This domain of TBP, which includes the H1 and S2 domain, is distinct from the H2 binding site for other activator proteins such as E1A. Tat binding to TFIID at this site stabilizes the interaction of TFIID with TFIIA in a gel shift assay. In addition, the Tat binding site appears to overlap the binding site for the negative cofactor, Dr1, since Tat effectively competes for Dr1 interaction with TBP. Finally, we show that cotransfection of wild-type, or a deletion mutant, of human TBP is capable of rescuing HIV-1 production in the persistently infected ACH2 cell line. These results suggest that the basal transcription factor, TBP/TFIID, represents an important regulatory molecule in HIV transcription.